Wages in the Netherlands can baffle internationals regarding how it is calculated or how much tax deducted from the new arrivals to the Netherlands are often unfamiliar with how wages are structured here. If you’ve never worked in an EU country before, the logic behind minimum wages, and the social taxes paid out of your salary, is probably as foreign to you as hagelslag op brood.
Gross salary versus net income
It’s important to keep the difference between gross and net income straight. While the difference between gross and net is the same in the Netherlands as it is everywhere else in the world, when discussing salary, employers in the Netherlands usually refer to the gross amount.
Gross salary (bruto salaris) is the total amount of your salary before tax and other costs are deducted. In the Netherlands, holiday allowance is a gross payment of 8% of your total gross salary. You should check with your employer whether the holiday allowance is included or excluded from your gross salary in the payslip.
Net salary (netto salaris) is your salary after income tax, social security payments and contributions for your pension have been deducted. The salary also includes bonuses, 8% holiday allowance, and other benefits such as 30% ruling tax for highly skilled migrants.
Minimum wages in the Netherlands in 2022
The legal minimum wage in the Netherlands is revised every January 1st and July 1st by the Dutch Labour Law.
The wage is based on a full working week, which can range between 36 hours to 40 hours per week. Like many other countries in Europe, the Netherlands sets the minimum wage per age until age 21.
By law, everyone working in the Netherlands between the ages of 15 and stated pension age is entitled to the Dutch minimum wage and a holiday allowance.
Hourly minimum wages from 1st January, 2022
Minimum wage requirements for expat employees in the Netherlands in 2022
In terms of income requirements for international workers on highly-skilled migrants visa, a certain salary criterion for their minimum wage is applied.
*Note: The above gross salary criteria excludes holiday allowance
Reduced salary criterion
In order to hire from abroad, the above salary criteria is usually required. However, there are 3 situations where employers could apply a reduced salary criteria when hiring a non-Dutch or EU person to work in the Netherlands:
1: The residence permit for employment as a highly skilled worker is applied to either during or directly following the orientation year for highly educated persons.
2: The highly skilled worker is no longer holding a residence permit for the orientation year for highly educated persons, but previously held this permit. The residence permit for employment as a highly skilled worker is applied for within 3 years of the graduation date, the date in which the doctorate was awarded, or the date in which the residence permit for scientific research expired.
3: The highly skilled worker has never had a residence permit for the orientation year for highly educated persons, but does meet the conditions for this residence purpose. For example, because the highly skilled worker has graduated, has a PhD or conducted scientific research. The residence permit for employment as a highly skilled worker is applied for within 3 years of the graduation date, the date in which the doctorate was awarded, or the date in which the residence permit for scientific research expired.
Set up your pay structure with Octagon Professionals
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